WASHINGTON (AP) — Banks borrowed less from the Federal Reserve's emergency lending program over the past week in a further sign that the strains from the financial crisis are fading.
The Fed reported Thursday that daily borrowing from its emergency loan program averaged $11.49 billion for the week that ended Wednesday. That's down by $2.24 billion from the $13.73 billion in average borrowing the previous week.
At the height of the financial crisis, emergency borrowing from the Fed's discount window exceeded $100 billion a day.
The central bank concluded a regular meeting on Tuesday in which it kept the target for its overnight borrowing rate at a record low of zero to 0.25 percent, where the key benchmark for consumer and business loans has been since December 2008.
The Fed once again pledged to keep rates "exceptionally low" for an "extended period" as the central bank works to revive an economy struggling to emerge from the most severe recession since the 1930s.
While many economists believe the Fed will likely keep the federal funds rate unchanged at least until this fall, the central bank is signaling that it is wrapping up a number of other financial support programs put in place at the height of the economic crisis.
In its statement Tuesday, the Fed said it would end by March 31, as planned, its program to purchase $1.25 trillion of mortgage-backed securities, a major effort that has kept mortgage rates low to provide support to the beleaguered housing market.
The Fed report Thursday showed that those purchases of mortgage-based securities from mortgage giants Fannie Mae and Freddie Mac totaled a daily average of $1.07 trillion for the week ending Wednesday, up by $39.38 billion from the daily average in the previous week.
Economists have credited these purchases with keeping mortgage rates low. While the Fed has said it will not sell off its holdings once it ends new purchases, some economists are concerned that mortgage rates may begin to rise.
Freddie Mac said Thursday that 30-year mortgages edged up slightly this week but held below the 5 percent threshold for the third straight week. The average rate on a 30-year fixed rate mortgage edged up to 4.96 percent this week from 4.95 percent a week earlier.
That rate had dropped to a record low of 4.71 percent in December and has hovered 5 percent since, kept down by the Fed's mortgage-security purchase program.
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